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File Number: 23-149 BACKGROUND On March 21, 2022, the City Council approved entering into a purchase and sale agreement to acquire the 33-unit Nimitz Motel at 555 Lewelling Boulevard. The City identified the Nimitz Motel as the target site to address the City Council’s policy priority to establish a short-term homeless navigation center with shelter and permanent supportive housing that will be affordable to the homeless or at-risk homeless population. For Homekey 2.0, the City partnered with the regional nonprofit developer, Eden Housing, Inc., to be the permanent supportive housing provider and the local nonprofit Building Futures to be the on-site supportive services provider. The City planned to develop the interim shelter/nav center itself and outsource the property management. The City, and its partners applied for Homekey 2.0 in early May 2022, but the State denied the application. The City enhanced the project team by adding the nonprofit developers, Allied Housing, Inc., and HCEB to replace Eden Housing, Inc. BF remains as the supportive services provider. One recent team change is that Allied Housing and HCEB determined that the latter would serve as the lead project developer to better consolidate the role and because HCEB had more capacity. HCEB, which is an experienced regional affordable housing developer with a specialty in special needs and at-risk populations, will serve as project developer and property manager for the interim nav center/shelter. Allied Housing, given its deep experience in affordable, supportive housing, will serve as a technical advisor to the City for the Homekey 3.0 application. A change that State HCD made in the Homekey 3.0 notice of funding availability (NOFA) was to eliminate the “Interim to Permanent Housing” eligibility category from prior Homekey rounds. Consequently, the City and its partners will apply in Homekey 3.0 under the “Interim Shelter” category, which must be kept as interim for at least five years before grantees can convert the property intro permanent supportive housing as the City had originally envisioned. Analysis The Homekey 3.0 application retains generally the same proposed project as its Homekey 2.0 application last year: Interim shelter/navigation center with later conversion to permanent supportive housing: I.Interim Shelter with Navigation Center (Years 1 through 5) After acquisition of the Property and approval of State Project Homekey funding, the City will undertake necessary renovations to begin operating the navigation center/shelter as soon as possible. During this interim period, the City will also find a more permanent site for the navigation center/shelter to move to and to explore additional public financing to convert the Property into long-term permanent supportive housing. Homekey requires capital grant funding to be expended within 8 months from date of grant award to facilitate the approved project’s operations as soon as possible. Homekey allows grantees to operate the interim shelter option for 15 years, but the City will work towards the permanent supportive housing option sooner (which would be after 5 years) Notable Interim Shelter/Nav Center Improvements: 1)Conversion of 4 of the existing 33 motel units into management and services Page 2 City of San Leandro Printed on 5/31/2023